U.S. Court of Appeals Dismisses an Appeal on the Question of Federal Diversity Jurisdiction

The U.S. Court of Appeals for the 7th Circuit in Chicago has dismissed an appeal from a U.S. District Court judge. In an extremely sad case, Robert Lindner’s parents, Burton and Zorine Lindner, were driving under a bridge near north suburban Glenview, Ill., when a Union Pacific freight train derailed overhead. The derailment caused the collapse of the bridge crushing the Lindners in their car. Their son brought a lawsuit against Union Pacific and a wrongful death action in Illinois state court alleging that Union Pacific’s negligence caused the accident and his parents’ wrongful deaths.

At the time the lawsuit was filed, there was complete diversity between the parties. That means that the residencies of the plaintiffs and the residencies of the defendants must be of different states. The decedents were residents and citizens of Illinois. The residency determines diversity jurisdiction. Mr. Lindner was acting as a representative of the estate.

Union Pacific is a Delaware corporation with its principal place of business in Omaha, Neb. Union Pacific removed the case to the Federal District Court for the Northern District of Illinois in Chicago because of the complete diversity of the parties.

During discovery, Lindner learned about two Union Pacific employees who had been working at the scene of the accident. One was a signal inspector who had called for an inspection of the track near the bridge where the train derailed. Another employee was a track inspector who arrived at the track just before the derailment.

Lindner moved to amend his complaint to add negligence claims against both of these individual employees and who incidentally were both residents of Illinois. He also moved to remand the action back to the state court because with these Illinois residents in the case the parties were not of residents different states and thus no federal diversity jursidiction.

Union Pacific opposed the motion, asserting that any state law claim against the employees would be pre-empted by federal law.

In the alternative, Union Pacific argued that the court should exercise its discretionary authority to deny any joinder that would destroy subject-matter jurisdiction.

The district court ultimately granted leave to amend the complaint and then remanded the case back to the state court. Union Pacific appealed that decision.

The appeals panel quickly noted in its opinion that Union Pacific was appealing the court’s decision only to allow Lindner to amend his complaint and join the two employees as party-defendants. The panel noted that the bar on reviewing decisions to remand a case back to a state court found in U.S.C. Section 1447(b) does not prevent the appellate panel from reviewing the separate, appealable rulings that happened to be contained in the same document as the remand order.

The court cited Powerex Corp. v. Reliant Energy Services Inc., for the proposition that here was no appealable order separate from the decision to remand. The panel stated that this was the case because an order allowing the plaintiff to amend the complaint was not a final and appealable order as it does not terminate the dispute or grant or deny any relief on any of the plaintiff’s claims. Because the order was not final, it was not appealable.

In addition, the court of appeals found that the order was not a collateral order subject to appellate review. The court of appeals concluded that it had no jurisdiction to review the district court’s decision. Finally, the panel rejected Union Pacific’s alternative request to issue a writ of mandamus compelling the district court to deny Lindner’s motion to amend the complaint. The court of appeals found that a writ of mandamus was not appropriate because Union Pacific had adequate means to correct any error in the district court’s decision by asking the state trial judge to reconsider the pre-emption issue and dismiss the claims against the two employees. Accordingly, the panel dismissed this appeal.

Kreisman Law Offices has been handling train accidents, automobile accidents, wrongful death cases, car crash cases, truck accidents, bicycle accidents, motorcycle accidents and nursing home negligence claims for individuals and families who have been harmed, injured or died as a result of the carelessness or negligence of another for more than 38 years in and around Chicago, Cook County and its surrounding areas, including Morton Grove, Niles, Des Plaines, Rolling Meadows, Maywood, Brookfield, Deerfield, Park Forest, Round Lake Beach, Schaumburg, Schiller Park, Western Springs, St. Charles, Romeoville, Glencoe, Chicago (Bucktown, Bronzeville, Back of the Yards, Austin, Archer Heights, Andersonville, Garfield Park, Hyde Park, Irving Park, Kenwood), Palatine and Lockport, Ill.

We serve the following localities: Cook County including Arlington Heights, Barrington, Berwyn Township, Chicago, Des Plaines, Glenview, Orland Park, Palos Park, Schaumburg, and Tinley Park; DuPage County including Downers Grove, Naperville, and Bolingbrook; Kane County including Aurora, Elgin and Geneva; Lake County including Waukegan; and Will County including Joliet.